Whether refund admissible, if services were not notified on the date of export but were duly notified on the date of claiming refund?

Facts:

In the instant case, Fazlani Exports Pvt. Ltd. (“the Appellant”) was engaged in export of goods outside India for which it has availed various services viz. Terminal Handling Service, GTA services etc. Accordingly, the Appellant filed several refund claims under Notification No. 17/2009-ST dated July 7, 2009 read with Notification No. 41/2007-ST dated October 6, 2007 as amended, towards Service tax paid on such services but the same was rejected by the Department on many grounds including denial on the ground that certain services were not notified on the date of export and were notified later.

Held:

The Hon’ble CESTAT, Mumbai relying upon the decision in the case of East India-Minerals Ltd. [2012 (27) STR 18] and WNS Global Services P. Ltd. [2008 (10) STR 273] held that the stated issue is no longer res integra, and since on the date of refund claim, the services were duly notified, irrespective of the period of export, refund is admissible.

2. Penalty cannot be levied when the entire amount of tax and Interest thereon was paid before issuance of SCN

Whether penalty can be levied when the entire amount of tax and Interest thereon was paid before issuance of SCN?

Facts:

In the instant case, Bellary City Cable (“the Appellant”) was a provider of a Multi System Operator Service and Advertising Agency Service (“Impugned Services”) and these services were brought under purview of Service tax w.e.f. September 10, 2004. The Appellant was not paying Service tax due to unawareness of levy of Service tax on Impugned Services. However, before issue of SCN, the entire amount of tax was paid and before issue of Adjudication Order, interest was also paid. But, the Department levied Penalty under Section 76, 77 and 78 of Finance Act.

Held:

The Hon’ble CESTAT Bangalore relying upon the decision in the case of CCE Vs. Muniruddin [2013(31) STR 136 (All.)] held that even ignorance of law can be one of the reasons for invoking erstwhile Section 80 of the Finance Act. Accordingly, penalties imposed under various Sections of the Finance Act were waived.

3. Cenvat credit cannot be denied merely for not applying for Centralised Registration in proper format

Whether Cenvat credit can be denied when application for Centralised Registration was not in proper format?

Facts:

The Ketan Motors Ltd. (“the Appellant”) had a centralized accounting office in Nagpur with branch offices at Chandrapur and Amravati. The services received and the Cenvat credit availed thereon was reflected in Nagpur centralized accounting system. The Appellant had applied for Centralized Registration through a letter in which it was stated that “they may be given permission to have only one registered place in terms of rule 3(a) of Service Tax Rules” and letter bears the stamp of the receipt by the Department.

The Department objected availment of Cenvat credit of Rs. 1,27,958/- (along with imposition of penalty) on documents pertaining to unregistered premises of the Appellant at Chadrapur and Amravati by alleging that the Appellant did not apply for Centralised Registration in proper format.

Held:

The Hon’ble CESTAT, Mumbai held that there is no dispute that the Appellant vide application dated December 16, 2004 has applied for Centralized Registration and the letter bears the stamp of the receipt by the Department. This request can be considered as an application for Centralized Registration, which was granted subsequently by the Department. Thus, Cenvat Credit should not be disallowed.